A whole, universal or variable universal life insurance
could be something you need but term life insurance is something that you’ll
never likely use. Life insurance could sound pleasing to you but you must first
assess if it would be feasible in your situation or else, you’ll be throwing
your money away to financial advisers receiving commission for the product.
Here are a few ways to see if a life insurance is something you really need.
1.
Quantity
It is important that you know how many life insurance
policies you could possibly need because you don’t want to buy anything that
you cannot use. However, if you pin yourself to just one expensive insurance
policy that limits your buying capability, you might miss the point of
insurances. Find the right balance that ensures your family will receive your
benefits should anything happen to you.
2.
Need
Permanent insurances are more expensive because it covers
you for the entire duration of your life. However, some people do not really
need life insurance policies. If you don’t have any dependents once you get to
your retirement age or your life partner has enough income from their own
assets, life insurances are actually useless for you. Assess if you need the
insurance carefully.
3.
Tax Benefits
Part of your repayments for a life insurance goes into a cash
value account that grows through interest, sub-accounts or even policy
dividends. Be sure to study your life insurance carefully before you purchase
it. Sometimes, some sub-account investments could have a high-risk value that
will require you to add more funds to maintain the insurance policy.
